Better than expected results from Lehman Brothers and Goldman Sachs and a three-quarter point rate cut from the Federal Reserve went a long way toward easing fears about the credit markets and the economy on Tuesday, sending stocks to their best one-day gain in at least five years.

Lehman shares soared 46% on its results. Its shares have risen about 130% off Monday's low, when investors feared that it might be the next major investment bank to collapse after Bear Stearns. The Bear Stearns failure resulted in a historic rescue and acquisition by JP Morgan and the Federal Reserve.

Yahoo was the biggest story in the tech sector, rocketing 7% after the company raised its long-term revenue guidance and said Microsoft's takeover offer significantly undervalues the company.

Jupitermedia, publisher of this Web site, fell 15% despite better than expected revenues, as traders focused on a $76.7 million write-down.

After the close, Adobe shares jumped on better than expected results.

The Nasdaq soared 91 to 2268, the S&P surged 54 to 1330, and the Dow soared 420 to 12,392. Volume declined to 5.52 billion shares on the NYSE, and 2.42 billion on the Nasdaq. Advancers led by a 30-3 margin on the NYSE, and 22-7 on the Nasdaq. Upside volume was 95% on the NYSE, and 92% on the Nasdaq. New highs-new lows were 28-116 on the NYSE, and 37-229 on the Nasdaq.